Crime

Massive Day-Care Fraud Have Ties To Terrorism

A day-care scandal in Minnesota has exploded; investigators have discovered day-care centers that are bilking the government of out hundreds of millions of dollars are funneling the money to the Middle East, and some of that money may be being used to finance terrorism.

The discovery came as a result of a investigation started five years ago.

Surveillance videos from a case prosecuted by Hennepin County show parents checking their kids into a center, only to leave with them a few minutes later. Sometimes, no children would show up. Either way, the center would bill the state for a full day of childcare. Video from that same case shows a man handing out envelopes of what are believed to be kickback payments to parents who are in on the fraud.

Then, Glen Kerns, a former Seattle police detective who spent 15 years on the FBI’s joint terrorism task force, got involved. He followed millions of dollars in cash transported out of Seattle, and found it was coming from Hawalas, businesses used to courier money to countries that have no official banking system. He tracked some of the money, and discovered it was sent to a Hawala in the region of Somalia controlled by the al Shabaab terrorist group, which pledged allegiance to Al-Qaeda in 2012. Al Shabba is banned as a terrorist group by both the U.S. and the U.K.

Kerns said, “I talked to a couple of sources who had lived in that region and I said, ‘If money is going to this Hawala do you think it is going to al Shabaab? And he said, ‘Oh, definitely, that area is controlled by al Shabaab, and they control the Hawala there.’” Kerns said the terrorist group likely demanded a cut of the money. When he looked deeper, he found that some of the people sending tens of thousands of dollars’ worth of remittance payments were getting financial assistance from the U.S. government. Kerns said he wanted to know where the poor families got so much money to send. He told FOX 9, “We had sources that told us, ‘It’s welfare fraud, it’s all about the daycare.’”

Acting Commissioner for the Department of Human Services Chuck Johnson told FOX 9 his agency is currently investigating 10 day-cares; FOX 9 has learned dozens more are being considered for investigation. According to search warrants obtained by FOX 9, every one of the centers under investigation has received several million dollars in childcare assistance funds. FOX 9 reports, “According to public records and government sources, most are owned by Somali immigrants.”

Asked by FOX 9 how likely it is that some of the illicit finds have gone to terrorists, Kerns replied, “I say absolutely, our sources tell us that. Good sources, from the community leaders. My personal opinion is we need a nationwide task force to clamp down on this type of fraud.”